QLD Mining and Energy Bulletin
Issue link: http://ebook.aprs.com.au/i/31843
AUSTRALIA FACES P IN A FEW YEARS rofessor Aleklett, head of the Global Energy Systems group at Uppsala University in Sweden, warned on his recent Australian lecture tour, that Peak Oil means that Australia will soon not be able to import enough oil to meet demand trends. This has important implications for mineral exploration and mining. Peak Oil is the time when the rate of global oil production reaches its all-time maximum and starts its inevitable downtrend. Forecasts vary between 2012 and well beyond 2015. Australia’s own oil production has been declining since 2000, and already 80 per cent of the fuel for our cars, trucks and planes is imported, either directly, or as crude oil to be refined in Australia, while some of our oil and natural gas liquids are exported. Declining global oil production, increasing internal consumption in OPEC nations and increasing demands from China and India will mean there is less oil available for importing countries like Australia, United States and Europe, just as their own domestic production is declining. Prof Aleklett last year published a critical review of the International Energy Agency’s World Energy Outlook, casting very serious doubts on the independence and methodology of the IEA forecasts. In 2008, the IEA predicted world oil production would grow from the current 85 million barrels/ day to 106 mb/d in 2030. However, the Uppsala group, using the same base data on existing reserves and future discoveries, can see only 75 mb/d. That is a substantial decline in oil availability instead of business-as-usual growth. This will almost inevitably mean oil shortages in Australia. The IEA and the Uppsala group agree that production is dropping in most existing giant oil fields by about six per cent per annum. It is the ability of new fields to fill this enormous decline gap which is the bone of contention. Prof Aleklett explains the difference is due to the IEA mistake in assuming unachievably high rates of extraction from future oil fields, twice as high as even those in the high-tech North Sea region. Oil has to flow through the pores in the reservoir rocks to find its way to the oil well to be pumped up. The flow rates depend largely on the laws of physics and on the geology and permeability of the sediments. Sadly, economics and market forces have little impact 42 QLD Mining and Energy Bulletin Winter 2011 MINING ISSUES